( 1 ) RULE. With the consent of the learned advocates appearing for the parties, the matter is taken up for final hearing today. In this petition under Article 226/227 of the Constitution of India, the petitioner has challenged the legality and validity of the order passed by the Development Commissioner, State of Gujarat dated 27. 6. 2005 by which the Development Commissioner has withdrawn the show cause notice issued for dissolving the Vagra Gram Panchayat on the ground that the budget was not passed/approved by the said Taluka Panchayat before 31st March 2005 as contemplated under Section 138 (3) of the Gujarat Panchayat Act, 1993 [hereinafter referred to as the Act ]

( 2 ) HEARD Shri V. C. Vaghela, learned advocate, appearing for the petitioner; Shri MR Mengdey, learned AGP appearing for and on behalf of respondents No. 1 and 2; Shri Pranav Shah, learned advocate appearing on behalf of respondents No. 3 and 4. Though served, nobody appears on behalf of respondents No. 5 to 10.

( 3 ) VAGRA Taluka Panchayat is constituted under the provisions of the Gujarat Panchayat Act, 1993, and under the provisions of the said Act every Taluka Panchayat under Section 138 has to prepare its budget. Section 138 of the Act reads as under : 138. Annual budget estimates:- (1) Every taluka panchayat shall have prepared annually on or before the 15th December of the current year or such date not later than 31st December of the current year as may be approved by the District Panchayat, in such form and manner as may be prescribed in this behalf a budget estimate of its income and expenditure for the next year and forward it to the district panchayat on or before - (a) the 31st December of the current year where the budget estimate is prepared on or before the 15th December of the current year, or, (b) the 15th January of the current year where the budget estimate is prepared after the 15th December of the current y ear but on or before the said approved date : provided that the budget estimate shall be so prepared that at the end of the year the panchayat shall have at its credit a balance of not less than such minimum amount as may be prescribed in that behalf. (2) The district panchayat shall scrutinize the budget estimate and return it to the panchayat within two months of its receipt with such observations and recommendations as it may make in respect of the budget estimate. (3) The taluka panchayat shall thereupon approve the budget estimate on or before the 31st March of the current year with such modifications as it may think fit having regard to the observations and recommendations made by the panchayat under sub-section (2 ). (4) Where any taluka panchayat has failed to comply with the provisions of sub-section (3) it shall be lawful for the State Government to form an opinion that the panchayat is incompetent to perform the duties imposed on it or functions entrusted to it under the provisions of this Act.

( 4 ) IT is the case on behalf of the petitioner that for the year 2005-2006 the budget was to be got sanctioned before 31st March 2005; necessary procedure was followed by the Taluka Panchayat; and budget estimated were prepared and sent for approval to the District Panchayat, Bharuch. It is also the case on behalf of the petitioner that the District Panchayat within the stipulated time returned the budget estimate to the Taluka Panchayat with its suggestions and thereafter it was obligatory upon the Taluka Panchayat to get the budget sanctioned before 31st March 2005. It is the case on behalf of the petitioner that the Taluka Panchayat issued an Agenda for the meeting to be held on 28th March 2005 for obtaining approval and sanctioning the budget for the year 2005-2006 and the said meeting was held on 28th March 2005 under the Chairmanship of President of Taluka Panchayat wherein out of 14 members, 11 members had remained present. It is the case on behalf of the petitioner that in the said meeting Resolution No. 126 be